The Nostalgic Nerds Podcast
The Nostalgic Nerds Podcast, where we take a deep dive into geek culture, tech evolution, and the impact of the past on today’s digital world.
The Nostalgic Nerds Podcast
S1E16 - The (Shipping) Container Monologues
Everyone loves fast delivery, but nobody loves thinking about how it works. In this episode, we dig into the overlooked story of logistics: the steam engines that kicked it off, the wars that reinvented it, the barcodes and warehouses that scaled it, and the robots now trying to keep it all from breaking. A practical, funny look at the global machine we depend on every day.
“You will not find it difficult to prove that battles, campaigns, and even wars have been won or lost primarily because of logistics.”
— Dwight D. Eisenhower
Join Renee and Marc as they discuss tech topics with a view on their nostalgic pasts in tech that help them understand today's challenges and tomorrow's potential.
email us at nostalgicnerdspodcast@gmail.com
Hello, nerds. It's your favorite tour, Marc and Renee. And this week, we're diving into a topic that's near and dear to both of our hearts. Like, right, Marc? Like logistics. We both love logistics. And we learned it at the same time in the same place. So, yay. That's right. You know, the art of getting stuff from point A to point B. But trust us, it's way colder than it sounds. We're talking everything from steam-powered trains to drone deliveries. It's like a roller coaster of technology and history, and we're here for it. So buckle up, because we're going to take you on a time traveling ride through the last 200 years of logistics history. You won't believe how far we've come. Now, before we go off into the 1800s, I just want to say, technically speaking, the Egyptians, when they were building the pyramids, were using logistics. I don't know how you build the pyramids without thinking about a lot of stuff, right?
Marc:Totally right. How you got
Renee:Those giant heads down to Easter Island. I mean, there was crazy stuff going on in the ancient world, right?
Marc:Stonehenge, you know, that rock comes from hundreds of miles away, right? Mm-hmm. Like, they had to... What did they do? They had to float it,
Renee:You know, and roll it. Down canals, yes, or across the ocean or down the coast. Yes.
Marc:I don't know.
Renee:Yeah, crazy stuff. But we're going to pick it up in the 1800s with the birth of logistics in the modern era. And this is the steam-powered era. So let's kick things off in the 1800s. Imagine this. It's the 19th century, and the Industrial Revolution is in full swings. Factories are popping up, steam engines are roaring, and goods need to be moved faster than ever. Enter the steam engine. And the game changer here is the railroad. Because most things the railroad helped change. I'm just going to come to admit it. Like, trains are important.
Marc:Trains are important.
Renee:Right? Before trains, transporting goods was a pain. Literally, you had to rely on slow, cumbersome, horse-drawn carts. But once the steam locomotive rolls in, it's like the first ever logistic superpower. Everything changes. Railroads become the backbone of transportation. That's when we see the birth of mass logistics. The idea that getting raw materials to factories and finished goods to the market much faster and on a larger scale than ever before. I mean, before it was, you went to a tailor, you picked something you want from stuff they made, they made it for you and put it in a brown paper and wrapped it up real good. And some random kid who was working for a living at seven would bring it to your house. And that's how it used to work, right? That's how you transferred goods in the 1800s.
Marc:We come back to trains a lot. I think this is what, like the third time we've talked about trains. So I think it's super important, you know, really critical industrial revolution, It's that era that proves that humans will inhale coal dust if it saves 30 minutes, right? And these machines that we're building, they just, you know, become faster and faster to be able to move goods back and forth across the country or across counties or across states or even across oceans for steam-powered boats, which we'll come to shortly. But that mechanism, essentially, that faster transportation means that the world shrinks in a way. And travel went from, you know, see you in three weeks to see you Tuesday. Compress time and you compress the markets. Logistics stops being a chore and becomes actual infrastructure. And for us, this sort of technology nostalgia, railroads in particular, are this really foundational component of technology. I guess, remembered history for us, right? It's something that, it's not so far removed like the pyramids or Stonehenge, you know? But it's at least close enough that we understand it and we can touch it.
Renee:And we can understand that infrastructure. You can still sit on a freeway somewhere, right? Next to the train tracks and see a bunch of double-decker containers go by you for, you know, 20 minutes thinking it's on its way to the East Coast, right? Because it came in through the port of Los Angeles. it's definitely going somewhere else, right? It's one of the busiest ports we have. It's definitely on its way somewhere. And rail is still the cheapest, cleanest, and fastest way to get things from one point to still today. Even though we in America don't have speed trains, it's still the fastest way of getting things places. So now I get it. And I don't think the West would have been settled without it, right? Without the transcontinental railroad, there's no way to get building materials across the country, right? There was no way to get people to live those places if they couldn't get there in some way other than a covered wagon, because that doesn't turn out too well too often, right? It was reliable. It ran on a schedule. Like, yeah, all of that was great. And I'll go one more to say that it's just our reliance on the technology of the day, right? Like that is, it is the one thing we talk about over and over and over again, is that when the technology is there, we take advantage of it for commerce.
Marc:Period. That's right. Period. Well, we increase, you know, the behaviors of the people don't change, right? They want their stuff. They want their food. You know, they want to, you know, exploit people. Right. But, you know, the behaviors don't change, but the speed, scope, reach is what essentially changes. I think, okay, let's see, we've talked about Barnum took advantage of trains. Yep. We talked about Sears took advantage of trains. Yep. We talked about bubbles and bursting. Gosh, oh, we talked about the industrial revolution with Chris and the ethics. Yes. I mean, this is, yeah.
Renee:Maybe the foundational technology that we still rely on even today, maybe it is railroads, right? I don't know. It's foundational. Like, even more than, like, airlines. Like, I've met people on trains that have never been on a plane. They've never gone to an airport. They don't know anything about it. Right?
Marc:Well, in Europe, you can travel all over, you know, by rail. And not have to get on the train at all.
Renee:Yeah, I took a train from Amsterdam to Italy.
Marc:Or not get on a plane at all.
Renee:Yeah, yeah, exactly. It was great. It went through the mountains. It was beautiful. It was a beautiful train ride.
Marc:Well, and in France, they're starting to shut down, you know, local, you know, inter-country plane routes.
Renee:Smart for them. Why have all that? I mean, if you really do take the Paris Climate Accord seriously and, you know, it's named after one of your cities, you probably should do something about that, right? Perhaps.
Marc:Perhaps. Maybe.
Renee:And that's a huge amount of CO2. Like, unless you can get a plane that's as clean as a train, which I don't even know how we would do that. I don't know. Anyway, something for the airline industry to think about. But let's move on to the World Wars, trucks and containerization, because I think this is where it becomes really, really industrialized. Right. So it's the Industrial Revolution brings us to the idea that trains are a good way to get materials, raw goods back and forth and into the hands of consumers and everything else. Like, like that's the beginning of it. But if you fast forward to the early 1900s, we got trucks rolling in. The motor vehicle is here to save the day. And you know what? Honestly, we need to talk about that sometime. Like the introduction of the car. You can't imagine how much horse crap there used to be on the roads just because the mode of transportation for everything was an animal that ate and then defecated. So, like, just that amount of, like, they said, no, they said in New York City, the fly situation was so bad, people would get diseases just being bitten by the flies. Like, it was a dangerous place, and the horses weren't helping. So, it's the motor vehicle comes to save the day, and railroads don't have the monopoly anymore. Trucks make local delivery faster and more flexible. You're no longer at the mercy of the train schedule. It's a new era. World War I and World War II. Okay, there were massive turning points in logistics. I mean, think about it. You got factories churning out tanks, airplanes, and ammunition. You can't afford to sit around and wait for a horse-drawn carriage to show up. But during both wars, logistics operations had to be fast, efficient. And massive, the military developed tons of new techniques like mass production, supply chain management strategies, and yes, airplanes for moving goods. The idea of just-in-time delivery, that was born out of wartime innovation. And if you thought things couldn't get any more revolutionary, we get to containerization. In the 1950s, a guy named Malcolm McLean, can you believe I bothered to look it up, decides that we need a better way to ship goods. So he invented the shipping container, the shipping, the stuff people make tiny houses out of. It's standardized, it's stackable, and it's so efficient that it changes global trade forever. No more unloading cargo piece by piece. We just stack them and go. But before we talk about the container, I do want to talk about like the logistics of world wars because I think that's where we get good at it. We get really good at it.
Marc:It is pretty cool.
Renee:Yeah.
Marc:Well, they talk about, you know, who's the famous general that said, The logistics wins wars, right? I'll have to look that up in the show notes. But the military becomes a logistics organization. All of them are logistics organizations. Supply chain management.
Renee:Yeah, because if you could get them the ammo, you could get them the food, and you could get them more people. And you could do that more efficiently than the enemy. Then you win. You win.
Marc:Or you're able to cut off supply chain for the enemy. Then you have an advantage. I think that this is conceptually, I think people understand this, but, you know, the scale and magnitude, particularly in World War II, when you think about how much ammunition, equipment, people, and then the fuel to move those people and the food to feed those people and, you know, the bullets, you know, for guns and uniforms and rubber and, you know, tires and metal. I mean, to move that much stuff, you know, requires a complete re-overhaul of logistics theory and logistics, you know, practice overnight. If you look at last mile delivery prior to World War II versus, you know, right kind of at the beginning of the European theater and World War II, it's night and day. It's a complete change in how delivery happens.
Renee:What I take away from World War II usually is pretty astounding. Like, you know, you get into the Eastern European countries and they're still really heavy in horses, like heavy in horses. There's not a lot of mechanical anything going on there. And even in Germany, still a lot of horses, like pulling stuff around.
Marc:Still a lot of horses.
Renee:Yeah. And like, I think you see the video and you'll see, you know, Nazis in their Mercedes Benzes and you think, oh, it's an era of cars. No, dude, it was not an era of cars. I know that's what we see in the newsreels, but it was not an era of cars. They really did have to figure that stuff out. And yeah, it was really up to, I remember, like, the thing that strikes me most about World War II is the Allies being like, there's no chance that Germany would squander its logistics and its railroads for the simple fact of killing people. Like the concept that you would use a railroad to move people from anywhere else in Europe to Auschwitz, like you would use the rails for that. They're so valuable as part of the infrastructure to winning a war that you would do that with it. Like it was beyond our comprehension to understand that. Like it's like, of course you wouldn't do that. That has to be a rumor. Dude, it wasn't. They had a mission and that mission was different than ours, right? We would have wanted those rails to move more stuff to the front line. They had really kind of given up on that. They own so much of it. What did they care, right? So, yeah. Let's talk about how the container ship, the containers changed everything. Because up until then, if you were, it was like on the Titanic. Remember they had a car on the Titanic. They were shipping it from one place to another. So it was just sitting in the cargo hall. Like that stuff ended. Like when we ship cars now, like every once in a while on like Instagram or something, I'll see somebody going through like the North Atlantic with those like those oceans, like when they get bad storms there and you'll see a container ship tip sideways. And you'll see all these containers just roll off the ship and you're like, I wonder who's not getting a car, right? Like, I wonder whose car is now at the bottom of the North Atlantic.
Marc:So, you know, in the money episode, we talked about the most important invention ever, which was double entry bookkeeping.
Renee:Yeah. Oh, right. The greatest. I still think it's a sewing machine, but go ahead.
Marc:The shipping container might be the best or could be a close runner up to double entry bookkeeping. Okay. So I've got lots of fun facts about shipping containers. Do you want some fun facts? Mm-hmm. Ready? Okay. Definitely. Okay. So the shipping container eliminated 93% of the cost of loading a ship. So before the shipping container, the cost was about $5.86 per ton. And it dropped, yeah, it dropped it to 16 cents a ton. Yeah. Wow. Can you imagine that? That's like.
Renee:AI is going to do that to entry level jobs.
Marc:Stop. Stop. We'll talk about AI later. Yeah. Container port can turn around a ship 30 times faster in the break bulk era. So I don't know, we didn't talk about this, but this is what cargo was called before containers, break bulk, 30 times faster. So a ship would take about a week to be loaded by hand, and it takes about a few hours to load now. So that's a complete change here. Global shipping shifted from move goods where they are made to make goods where is cheapest so this is like this is not something we think about a lot now because it's just de facto the way it is because it only costs 16 cents a ton to ship something but now it's it's This is the result of the shipping container, the change in where the labor actually happens. And it feels wrong to make something in one country, to then ship it across the ocean to another country, to then ship it to a third country to then sell it. And you're talking vast ocean distances. But in actuality, that is the cheapest when you consider labor costs and the cost of shipping. So that's a crazy change here.
Renee:I guess the automotive industry has decided you build where you sell, right? So if it sells in North America, interestingly enough, not a lot of that is built in the United States. So assembly in the United States doesn't have a lot. It happens in Canada and it happens in Mexico and they ship into the U.S. The parts are coming from China. What's really being done in the U.S. is the engineering and the design. Everything else is being handled somewhere else in order to sell it to a U.S. Customer. So, yeah, we don't even build cars really anymore. Like a handful of places might still do. Toyota has a couple of factories. Ford has a couple of factories. Honda has some, but it's because they're building where they're selling, right? It's a Japanese manufacturer in the United States. Hyundai. That's right. It's a Korean manufacturer in the United States. It has nothing to do with anything other than that's how we build.
Marc:Yeah.
Renee:Yeah. Yeah.
Marc:The first shipping container voyage in 1956 with McLean, he used a converted oil tanker. So get this, he buys an old oil tanker. He welded frames onto it and stacked 58 containers on the deck. So that voyage saved enough money that the entire shipping industry panicked and immediately copied him. So one, yeah.
Renee:At least they didn't put him on a train and send him somewhere, right? That's what he could have done. He could have been found dead in his own trunk. But no, they just changed.
Marc:Yeah. So that overnight change, okay, so containers, as you said, normalized, standardized, stackable, right? They're all the same size. So the containers standardize everything. Not just the ship sizes, but ports, cranes, trucks, railroad cars, get this, warehouses, storage yards, right? Like everything gets derived in the supply chain from that one shape of the container. Right. Containers are so durable that many end up as buildings, right? Some people have container houses. I have a shipping container next to my house here. That's right, you know.
Renee:I'm going to go put a triple-decker one on your land in Arkansas. So I'm going to live there by the lake in a shipping container. That's fine.
Marc:Let's see. Most lost containers don't sink. I thought that was really interesting. What, they just float? Yeah, they float for weeks just below the surface, invisible but deadly to other ships in the shipping range. Yeah, and there's a whole GPS tracking system built around that problem, which I thought was really, really interesting.
Renee:So your car is out there floating in saltwater for like a week and a half while they figure out where it is. What do they do, go fish it back out? Do they go get it?
Marc:If it's viable, yeah. That's crazy. Yeah. That's crazy. Let's see. Yeah, the standard size, 20 foot and 40 foot, is called a TEU. 20 foot equivalent unit yeah so like we had rack units one rack unit 42 rack units right this is you know the teu the 20 foot equivalent unit so there you go
Renee:When they sell the container did they sell it fractionally can i put stuff like could there be 10 of us in a container and we're all renting one part of that container for the shipping that's why it's so cheap.
Marc:Yeah, no, it's actually, you can, logistics companies actually sell, you know, by that, by that TEU, and you can buy fractional around that. So, have you ever done this when you've moved houses and you bought, like, you know, a container and you, you know, fill it a certain amount and then it goes off somewhere? You've not done that?
Renee:No, no, no.
Marc:Yeah, that's, that's how that works.
Renee:Pack up a U-Haul and I, although I did hire a bunch of guys the last time I was convinced they were going to steal it all. Because, you know, I'm harassed by Russians. Why wouldn't they steal all my stuff?
Marc:You hired Victor with a K? What are you doing?
Renee:Sam did.
Marc:Victor with a K.
Renee:And you know what? Like, they were like three hours late, and he's starting to think, maybe they did steal it. Like, uh-huh, it is the Russian mob. Like, maybe we really did get into the wrong business here. All right, let's talk about that.
Marc:So just one last thing. It's the closest thing to perfect technology. A rectangle that solves globalization. chaos reigned before that in the ports every crate was a different size dock workers had hernias mclean shows up and says what and says what if boxes suddenly the world runs on lego stack and ship it it just drops prices so fast just because the metal box is consistent so it
Renee:Was a pretty good invention we're going to give mclean you know.
Marc:A good one. It's pretty good. It's pretty good. I mean, it's no double-entry bookkeeping.
Renee:Right, right. You're a huge fan of that. But no, this is pretty good, though. It did change everything. There's not many things in life that would change everything.
Marc:Vulcanized rubber. We'll have to talk about vulcanized rubber at some point.
Renee:All right, so let's talk about the late 20th century, where everything starts going global. Globalization kicks into high gear, and suddenly we're not just shipping goods across the U.S. or Europe. We're talking the world. And for logistics, that means big changes. It's the rise of computers. In the 80s and 90s, saw computers and GPS transform how we track goods, optimize routes, manage inventories. Remember that scene in Back to the Future Part 2 where they talk about self-driving cars? Yeah, that idea wasn't too far off. GPS and tech are setting the stage for it. And speaking of tech, the internet is the next big wave. As e-commerce explodes in the late 90s, It creates this huge demand for faster, more reliable delivery systems. Amazon, anyone? It's not just about books anymore, right? People want everything. And logistics companies have to figure out how to get it to them and fast.
Marc:So, Renee, you know, I used to work for a dot com.
Renee:I vaguely remember that.
Marc:I resemble that remark. I mean, this is where you and I learn all about pick and ship and fulfillment and logistics.
Renee:And the Cuba scan.
Marc:And the Cuba scan. I love the Cuba scan. You've not lived until a conveyor belt sends a spatula on a cross-country journey because it misread a barcode. So i think you know the the real cool thing about this was that we were in a very special time where there was this transition from you had to have your own warehouse and your own fulfillment your own logistics to drop ship capability which was not quite it was it was starting to emerge but it wasn't quite there. And that shift meant that there was a difference in how you manage peak, right? We always lived in peak Christmas time. And I know you'll talk about your favorite Christmas peak stories, but You know, there was there's other peak sorts of events, Mother's Day, Valentine's Day, you know, when Oprah gets on the on the television and talks about, you know, some magical product or whatever like that, that sort of stuff changes how, you know, e-commerce sites have to manage, you know, their their algorithms. And that's a complete shift from what we had in the previous century, which was like, it's in stock, it's out of stock, it's out of stock, I order more. You know, and this is a different kind of mechanism so that the logistics can be more efficient and route, you know, based on predictive analytics and, you know, not just stock on hand, but stock in other warehouses that are managed by other players in other states or other countries or whatever. It's a completely different mindset in the late 90s.
Renee:So what I remember most about that transitional period was like most of what we had in the dot-com, because we sold cookware and stuff like that. So a lot of the stuff we had, we had in the warehouse, right? In the warehouse. We would have to take it all in. And the software was incredible. What the software was doing was we would take it to the CubaScan. And the Cuba scan would scan the box and it would say, here's how big it is. And then you'd say inside this box are 12 of these things and you would scan those and it would say, OK, so in overflow, it's taking that box and putting it somewhere where it can put it. Those little boxes in pick are going to a different part of the warehouse where people are going to pick it. Right. So like those two things are separate. And the software is keeping track of when the last one gets picked off the shelf and picking. Somebody is already bringing over the new one because the software told them what to do that day. Like that's how and everything was managed by barcodes. Right. So at Christmastime, when people like you and me ended up in the warehouse doing picking for orders, you'd have an order and it would take, like somebody ordered 10 things. It would take you on a walk around the pick part of the warehouse where you were picking and putting the order together with your little cart. You would actually go around and pick it, scan it, pick it, scan it, pick it, scan it. When the scanner beeped twice, you were done. You took that, you put it on a conveyor belt, it went to somebody else to package it. They would put a barcode, they'd scan the barcode, it would print out a shipping label. It would put on that and it would go sit in a box waiting for UPS to come get it. It's why we did it in Rancho Cucamonga because there was a UPS facility right there.
Marc:Well, and remember, the Cuba scan could figure out if it was cheaper to run it through to UPS or postal.
Renee:Yes, because it was looking at tables of cost, right, and how fast you wanted it and everything else. And this is at a time when we used to pay for shipping. Like people, every person who bought paid $9.99 for shipping. It wasn't, you know, like Prime wasn't a thing then. So, yeah, I mean, that's what I remember. Like when I think back to about like my bout with logistics, it was how smart that software already was in like 1999. It was already really smart. I can't imagine how different it is today with robotics and with algorithms and predictive analytics and everything else. I mean, if you're somebody like Marshall's and you buy a bunch of out of season stuff, wouldn't you want to know which of your stores you can sell which sizes in? Because I often think like I'll go to one store and I'll never find my size, but I'll go to a different store and I'll find nothing but my size. I'm like, oh, this is where the fat girl shop. I should shop here because clearly they move this merchandise in a way where other stores don't. But as mean as that might sound, it is a logistics thing to sell your stuff, right? Like if you have a lot of people who are an average size 14, well, then go sell it there. Why are you bringing it to Manhattan Beach where they work really hard not to be a 14? Like, why would you even bother? Right. So like that was my thing. And I really I think back on those days and I think how much I learned because I had a warehouse in my environment and then how much I respect places like Amazon for sorting that out and getting better and better and better at it until they're so good at it. You can order same day like that to me is borderline crazy.
Marc:I just remember the Solaris machine that was there.
Renee:It was the size of a small refrigerator. It was gigantic. Yeah. And I knew nothing about it. Dana ran the whole thing herself.
Marc:Nobody would touch it. Someone would be wrong. Marc, don't touch that. Don't touch it.
Renee:You are not qualified. You are not wrong. I agree. I am not qualified. I'm going to go work on my stupid web servers. I'm happier there anyway. Click, click, click.
Marc:Oh, I got to reboot the servers again. Yeah.
Renee:All right. Everybody. It's going to be a minute. Yeah.
Marc:All of that. Time for the nightly reboot.
Renee:Oh, don't make fun. I miss the B-Sod. The time we come into e-commerce, automation, and sustainability. So let's fast forward to the 2000s. I get married in e-commerce. The boom is in full swing. We're not just ordering books anymore. We're buying groceries, gadgets, toys, and everything in between. And the logistic companies are scrambling to keep up with next day or even same day delivery. Robots and AI start entering the scene. You know, those cool warehouse robots. They've been around for a while now and they help move stuff around the warehouses at lightning speed. And don't forget drones and autonomous vehicles. We're talking about the future of delivery, flying drones, dropping off packages in our front yard. Seriously, how sci-fi is that? And it's happening. And while all this innovation is happening, logistic companies are also realizing the need for sustainability. We're seeing more eco-friendly transport options like electric trucks and greener packaging, all to reduce the environmental impact of our ever-growing demand for goods. And I would say like, yeah, right now, Tesla's having a little bit of a tough time getting like Anheuser-Busch to go all in on their autonomous rigs. Right now, there's a one-mile. Road that goes from the brewery, the Busch Brewery, Anheuser-Busch, down to where they stage it to ship it. So to the rail lines, essentially, right? But it's one mile and it's a private road. So what's better than autonomous vehicles for that, except maybe a train? Like, yeah, put the autonomous vehicle on the road. Well, what they realized was if you were packing that thing up with potato chips, it could do that trip six times before it needed charge. Sure. But as soon as you put beer in it, it gets there, but it can't get back because of the torque. It needs to get there. So they have to recharge it before they can send it back to get more stuff. And they started to realize this might not be like the right approach because we can't load the truck. The trucks are going two thirds full, one third full because they just it's too much battery power to get them there. They're just too heavy. Right. And so even in this moment of incredible ability to move things around, we still have challenges we haven't quite sorted out.
Marc:Well, I mean, the power density of, you know, diesel is quite high versus a battery, right? I mean...
Renee:But you also have a bunch of companies who are part of logistics that have now, you know, net zero pledges and they're part of the signed on to the Paris Climate Accords. They're talking about how to reduce the carbon footprint of the delivery. Okay. And that's everybody. That's UPS. That's FedEx. That's everybody.
Marc:Yes. Okay. Everybody has a logistics, every logistics company and probably everybody that deals with logistics has a net zero pledge. But half of them read like they're sort of horoscopes, right? They're inspirational and vague. The serious ones are making real changes, which is good, but most of them are not. It's not just, you know, we'll build better equipment, but it's optimizing routes. Yes, electric fleets, better packaging, you know, packaging that doesn't look like it survived a bar fight. And, you know, logistics actually saving money. Now, this is a And conceptually, logistics has always been about saving money, right? But in this scenario, the optimization only gets you so far. And so now you have to change your mechanisms, change your equipment, change the modes of transportation. I've got a bunch of facts for net zero and shipping logistics, though. This is a fun fact episode for me.
Renee:Before you get to your fun facts, let me just remind everyone that during COVID, everybody was like big on like, what are we going to do to differentiate ourselves in this black hole that we're all in? One of the things that was happening, because I covered sustainability for Forrester for like a year and a half, two years, something like that. And it started during COVID. But what you would find out is I would get calls from clients and they would be like, all right, Renee, we said we would be net zero by 2040. Now what do we do? It's like, oh, I don't know. Shouldn't you have thought about that before you called me? Like, why am I the one having to figure this out? Like, why did you say it out loud? We had to say something. You didn't have to say anything. Nobody asked you to say anything. You should have figured out where am I today? Where do I have to be in order to meet my 2040 requirements? And what can I do first that would be give me enough running room to deal with all the other stuff that's going to come after? Because it just gets harder and harder and harder. There's stuff you can do at the beginning. Quit traveling as an organization. Start doing way more video conferencing. Oh, and on your video conferencing, Only do that once in a while. A video call is 90 times dirtier than a phone call. Stop it. Just stop doing them. Really? Yes. Video, like, just from a carbon footprint. This is terrible what we're doing right here.
Marc:Terrible. Well, this is terrible what we're doing.
Renee:But we have 38,000 listeners, so I don't really care.
Marc:See how that works. Okay. But so, yeah. Yeah. But, like, the alternative is I get on a plane.
Renee:Right? Yes. Yes.
Marc:Yeah. Yeah. And as much as I would love to reach out and give you a hug,
Renee:Like, I mean— Well, that doesn't make any sense either, right? Because the carbon footprint of that is crazy. That's why you see large research firms— So you're.
Marc:Never going to come visit
Renee:Now? Yeah. Well, no, I'm coming to visit. That's vacation. Okay.
Marc:Okay.
Renee:Yeah. But I would say that, like, yeah, but that's how the big firms did it. That's how, like, the research firms and the consulting firms, they were just like, we're not traveling anymore. That's too much of a scope three problem for us or scope two problem for us. We're done. We're out. We're not doing it.
Marc:You're like, okay. Think about a giant. Yeah. Think about a giant size global bank, hundreds of thousands of employees, as you say. And when I worked at HSBC, the bulk of my time at HSBC, no travel because of COVID, because of COVID. And that was a huge boon to my budget. Because you know you you basically budget a certain percent you know a certain amount per person per year your travel when i have an organization of 6 000 people globally you know engineers all over the world and you know it's like you figure how much you know per person traveling it's it was a sizable budget yeah and basically that gets returned back to me and you know i you know i got eaten up with other things but like that was a huge huge save so thousands of employees not traveling is a financial save, but it's also an environmental save.
Renee:Yeah. So, anyway, go ahead and give me the facts. Fun facts. Fun facts.
Marc:All right. Net zero shipping and logistics. All right. Shipping today produces about 3% of global CO2. That's roughly the same size as the entire aviation industry or a country the size of Germany. So, one giant floating Germany.
Renee:Wow.
Marc:That's a lot. 3%, though. I think that's less than I expected.
Renee:I would have expected it to be like 9. Yeah, I would have expected it.
Marc:Yeah. But, you know, you think about it, like, that's pretty efficient. It's pretty efficient. If shipping were a country, it would be the world's sixth largest emitter. Have every country except China, the U.S., India, Russia, and Japan. So, yeah, a country entirely of containers and paperwork.
Renee:Wow.
Marc:The biggest ships are already 80 times more efficient per ton than trucks. So, 80 times more efficient than trucks. Large container ships burn a lot of fuel, but per ton mile, they're ridiculously efficient. And we talked about that cost earlier.
Renee:Yeah, yeah.
Marc:Let's see. Oh, okay. The world's first carbon neutral container ship launched in 2023. What? It runs, yeah, it runs on green methanol, which sounds like a breaking bad pilot, but it's actually a low carbon fuel made from renewable sources and captured CO2. So I'll have to do more research on green methanol because anytime somebody says like, you know, clean coal or clean methanol,
Renee:Clean diesel, like you're all lying.
Marc:But but methanol, I mean, methanol, as long as I have a thing against food for fuel, I don't like, you know, producing crops to turn into fuel. So as long as methanol is not being, you know, this green methanol isn't like actually coming from, you know, food stocks, then I guess I'm okay. Well, you've probably seen this. Wind power is back. Modern cargo ships are testing giant carbon fiber sails and rotor sails that cut fuel use up to 20%. It's the first time since the 1800s that ships look like they go back to swashbuckling, right? Big old, you know, sails.
Renee:It's kind of cool.
Marc:It is kind of cool. And then, you know what? Of course, when you see this on the interwebs or whatever, some idiot goes, oh, you know, and then they'll post a picture of like an actual three-masted sailor or something like that. You're like, okay, come on now.
Renee:That's not what anyone's talking about. And you would think you could, like, there could be tons of ways to generate electricity on a boat. Like, the kinetic energy of the ocean has to help somehow, right? Like, there's got to be a thousand ways to do that. Yeah. Yeah, that's good.
Marc:Maersk, who's, you know, the biggest in the shipping world, has committed to net zero by 2040, 20 years ahead of most industries. Let's see. Let's see. Most ports are switching to electric.
Renee:Oh.
Marc:So that's cool. Oh, where ships idle, the trucks swarm. They have this sort of swarming algorithm. Let's see. Let's see. Refrigerated containers, sometimes called reefers, are secret energy monsters. A single refrigerated container can use as much electricity as 20 homes. Ooh. Yeah. So this actually turns out to be one of the biggest challenges in the whole shipping industry is decarbonizing the reefers. Let's see.
Renee:So I worked for somebody who cored ice in the Antarctic and she said they would put them in containers, put them on a container ship and make sure that And it was a special container because the container had to keep the ice cores frozen. And then she said one day they got there and they opened the container and all the water poured out. They'd realized no one plugged it in. Oh, like layer one on the OSI. Did you plug it in?
Marc:Yeah, did you plug it in?
Renee:No one checked it.
Marc:I've gotten lots more. I think, let's see, this one is, this one I think is really interesting. Slow steaming saves up to 30% of emissions. So just dropping your speed a few knots massively cuts fuel use and global trade becomes calmer, you know, everybody breathes easier. So if you just cut back just a little bit, it can actually save quite a lot.
Renee:But I've watched a lot of Deadliest Catch, and I know they're going the way they're going so that they can beat, like, the weather, usually. I don't see anybody being crazy with that stuff. They're usually just trying to beat waves or weather, right?
Marc:I mean, well, yes. So when I was in Colorado, we used to live next door to a ship captain. And this is what he did is he would run these, you know, these large shipping containers and stuff. And, you know, it's incredible how much of it's automated on the ship. Literally, you could run the entire thing by robot if you wanted. And, you know, telemetrics and GPS and all of that. So it's quite efficient. They've driven out quite a lot of things.
Renee:So how long before one captain is in charge of a fleet and he's running it all from his home office in Colorado?
Marc:Yeah, I think that that's a real possibility. I mean, the issue is pirates and, you know, piracy is a real problem. It's a real thing. Not so much in American waters or European waters, but crossing to get to certain places. Yeah, it's a big deal.
Renee:I always feel like that's, it's a, it's kind of like a red herring. Like if you really, like everybody goes to a safe room, these guys try to get to the place where they think the value is, wherever that is. And then you just turn on the hay lawn and we're all good. I don't understand why there isn't a way to suck the oxygen out of the room they're in, knock them out. Like, there's a thousand ways to handle that. I'm not sure why it's still a thing.
Marc:Well, I mean, the bridge... Yeah. I mean, it's, it's, you have to be able to take over manually, right? If something bad happens, you can't control it via GPS or remote satellite or whatever,
Renee:You know. And then you had to go, when your server hung and you had to call the knock and make them go do it.
Marc:Yeah. Yeah. Yeah. No, piracy is an issue. So let's go to where's, where's, what's next? Tell us what's next.
Renee:Oh, here, what's next? All right. So we're going to talk about the 2020s and beyond, the future of logistics, and it's going to be epic. So now as we hit the 2020s, right, logistics is all about digital transformation. I mean, we're seeing Internet of Things, IoT everywhere from smart warehouses that talk to each other to real-time tracking of shipments. Blockchain technology is making an appearance here, making everything more secure and transparent. After COVID-19, the importance of agile, resilient supply chains became crystal clear. I'd like to say it woke us up after that hurricane hit Puerto Rico when we realized we couldn't get another IV bag to save our lives. That's where they all came from they all came from puerto rico like that's when things like for me logistics started coming home to roost it was like uh-oh we made the world a tiny place and when we can't get things like to each other it becomes a real problem so logistics companies had to adapt fast and it changed the way we think about just-in-time inventory and global supply chains the future is about resilience speed and customization that's what's going to kill us in the long run, right? Like, we have become, as a society, we've become so, we have embraced individuality to a point where it's going to really mess with us in the long run, right? Like, I will go back to the idea that I would rather have a data center with all the same hardware than a data center with everybody's hardware, however they wanted it, in whatever color they want, doing whatever they felt like. Like, no, of course not. That's not how you run anything efficiently. Like that's not how anything runs yet. Everything drives us toward that individual, that the individual marketing, individual sales, individual, like a genic AI that's going to look like me and talk to other stuff. Like it's crazy, right? So if the future, and it is, it's about resilience, speed, and customization. Last mile delivery is becoming more tech driven with drones and autonomous vehicles stepping in to help with urban delivery. So who knows in 10 years we might just have fully automated AI powered logistics systems just running the world That'll be fun.
Marc:Well will it be will it be fun i don't know no probably not i you know yeah resilience is an obsession in in all the different industries that you know you and i play in and you know logistics is no is no different i think it's it's interesting you know the way you said it you know this kind of obsession with customization and individualization and logistics has to be the opposite of that it has to like in order for it to operate efficiently it has to operate at scale it has to you know be standardized right the shipping container and that's not that's not But, yeah, it feels a little bit counter. But I think there's new technologies in the mix that help break that a bit, right? Autonomous drones and autonomous vehicles. You know, last mile systems, but also things like 3D printing even, where the last mile is no longer a logistical problem. It's a data problem.
Renee:Data problem, yeah.
Marc:You know, robots working in warehouses are never going to get tired. And that means that warehouse operators can scale for speed and, you know, longer use, right? They can run 24-7. it.
Renee:That's what I think is really interesting. So anytime you look at like robotics and like what we consider the state of the art. So every time we see like a humanoid looking robot with hands and fingers and it can tie a bow and it can like, like that's what we consider state of the art. But the guys who were working on Tesla's robots, a couple of young guys who really tried to explain to their CEO that you can't build robots that look like people. The same things that are happening in the distribution center to people are going to happen to these robots, right? Elbows are going to wear out. Knees are going to wear out. The balancing of stuff so you don't break it. What you're asking of that robot is not going to make that logistics any easier. It's only going to add to the problem. And we're going to be replacing parts on machines the same way we do on people. You're going to need an elbow replacement. You're going to need a knee replacement, a hip replacement. Why do it? And that's when he said to the CEO, whose name I won't mention, like, hey. This should just be a flat box. It should look more like a pallet than it should. But it can lift things and move them. Right. Like, that's what we want it to do. We want to lift and move. We don't need to pick things up and carry them. And he said, I don't want to hear it. That's what I want it to look like. And they both quit and started their own company. So when I think about like, will we come out the other side of this and will it make more sense? Yes, of course. But are we going to need people to do it? Yeah. It's like every James Cameron movie you ever saw. Right. Like, sure, you can put the person in the robotic eco, like, exoskeleton with the big guns and send them out to shoot stuff. But there's still a guy in it, right? Like, that's, I think, where we're headed with all this. No matter how automated you want to make it, no matter how – like, in the end, we need people for when things break or fall or – like, that robot isn't going to pick something up itself. It's not going to pick itself. It's not going to – there's a lot else that happens in that world that a robot is interested in.
Marc:But if you live, if you watch, and Amazon's pretty secretive about video inside their warehouses for lots of reasons, right? Right. Not the least of which is human rights abuses. Right, right. Right. In the warehouses where they've gone full-on automation, those robots are exactly as you described. They're flat. They pick things up. They shift them. They move stuff around. They move stuff around. I saw one video where it was moving stuff so fast that the boxes were almost falling off of the pallet. That's crazy. It was literally just speeding through. And all of these robots have, you know, these this kind of RFID, you know, near field technology where they can detect each other. They can ride around each other. You know, they can learn, you know, different things. Different robots actually start to have preferences for areas that they work. And it's really fascinating stuff. So, you know, the future is is, you know, the future is already here. Yeah. Right. When we talk about AI and robotics and that, like that's already here and very advanced warehouse logistics. And I think that the next, you know, we started this conversation around transportation. And I think that that area hasn't quite, you know, gotten where. The warehouse logistics are, you know, around robotics and automation and all of that. But we're starting to see driverless, you know, cars, driverless delivery, drone delivery. And it's still a little bit wonky, right? But if we're in that stage now, then in 20 years, we're going to see.
Renee:I expect, yeah, in 20 years, FedEx will have its own lane on highways. And FedEx and UPS and like any logistics company, they'll have their own lane on the highway. And they're autonomous vehicles. We use that lane to get in between places between either the port to where it's going to distribute or from the airport to another distribution area, cross docks, wherever it's going. Right. Like, I really feel like that's where we're headed. We're headed like this idea that that last mile, I think the last mile, the mile to me will still be driven by somebody for a while. But that other space in between from it came on a ship or it came on a plane and it's going to a warehouse, that should actually be – I think it's going to be two things. I think you're going to build your warehouse closer to those facilities and you're going to build a private road to get your stuff there. Because then you really did what you meant to do. You are in control of everything until it gets onto that train or it gets onto that boat or it gets onto that – you're in charge of everything. And you're in charge of everything until it gets to your warehouse. At that point, it goes back out again to wherever it's going to go. Yeah.
Marc:But you see, I mean, that whole distribution, like proximity to port, I mean, that's been happening for quite a long time, right? Yeah. We see that in all sorts of port, you know, port locations. You know, that'll continue to advance. You know, the reason you can't do it in Los Angeles, right, is that the real estate's too valuable around that area. Yeah.
Renee:Long Beach, it's too valuable. Port of LA down in Alameda, it's too valuable. Yeah, all that stuff.
Marc:That's why the distribution centers in Ontario and Riverside.
Renee:Right. Yeah, they're talking about building some out here, and we're like, no, no, Riverside can keep them. We'll keep building golf courses, I guess, out here in Coachella.
Marc:There you go
Renee:Yeah so yeah I mean that, I guess that last piece of it, that the idea that, you know, the future, like we're in the future, right? But the idea that it's just going to get faster and better and more efficient and more green and all of that is true. And I guess it's the idea. And I mean, we're living in a tariff regime right now. And like I think about that and I think about how disruptive that's been to global trade. But then I think the rest of the world adapted to it just fine. So if you think that there isn't software in this world that allows people to figure out what to ship, who to ship it to, where to originate it from, and how to get it there to pay the least amount in tariffs, like, we were already doing that.
Marc:Yeah, that's been, like, 20-plus years now.
Renee:Yes, like, we've been doing that a long time. So, like, even in this world, because the soybean farmers are saying, we can't lose soybeans again. You're taking away our market. Well, yeah, of course you are. Like, you know who the biggest buyer of our soybeans were? China. Like they bought so much soybeans for us. But the minute we said there's 150% tariff, they started buying it from Brazil and they'll never come back. They don't have to. The software's telling them, don't bother. We're too much of a risk now. So all of this stuff really, really matters. It matters in global economy. It matters in you getting your stuff on time. And it definitely matters now around the holidays because you want your Legos. And if they don't come to you in three days, you're screaming at FedExact and asking where it is because there's nothing more important than Legos.
Marc:So I picked up this whole supply chain or logistics thread again because it wasn't Legos for me. It's my plastic robots, you see. Right. And during COVID, you know, supply is, you know— Plastic, you know, these are all polystyrene plastic, right? Well, guess what? You know, if you're not shipping plastics because you can't ship anything, then these don't get built. Okay, fine. Well, that disrupts plastic supply chain the world over. And then what else is impacted? Well, chip production, you know, because there's plastics used in, you know, in housings for chips. And then what else gets impacted? Oh, well, components for this. And it's this whole, like, You know, it's a domino effect. You know, if you stop, if you put the brakes on, you know, this whole global economy really hard, it eventually finds a way to, you know, to find new routes and sell and trade and all of that. But the impact is, you know, prices change. And, you know, I'd have to look at my notes here, but the price to ship a shipping container post-COVID increased like five times, like fivefold.
Renee:To 63 cents.
Marc:Yeah, but if you think about it, like, but there's a wholesale price and a retail price, right? You know, and the wholesale price is, you know, is, you know, marriage-based. Pennies, but the retail price is quite expensive to ship a shipping container. So you think about, because you could ship a lot of tons inside of a shipping container. And, you know, that whole reorganization of global trade, it's sort of sticky. Once it happens, it doesn't unstick itself very easily.
Renee:No, there'd have to be something else that happened in that country for it to unstick. Like that's the only way it happens. Yeah.
Marc:Yeah. For Brazil to Brazil to stop selling soybeans to China, then something has to happen in Brazil. You know, the farm, you know, gets hit by hurricanes or they don't have hurricanes so much in Brazil.
Renee:Wildfires.
Marc:Cyclones, wildfires, whatever.
Renee:Yeah. Yeah.
Marc:Yeah.
Renee:Disease. Like whatever would take down that farmland is like, yeah, that's what it would take. And who knows? Maybe Mexico figured it out and now we buy it from there. Like I, it really is like, like anybody who sits there and thinks, well, it's okay. It's only a couple of years. We'll get back to it. No, no. Once it's gone, it's gone. It doesn't go back. There's no reason for it to go back. It's cheaper that way. Like there's no reason. It doesn't matter if we gave it away. It would, there would be no reason. We can't be trusted to keep doing it.
Marc:Yeah. Plastic prices were jacked up for five years, you know, during the whole pandemic thing. And now we're coming out for, you know, years after years of impact to supply chains because of COVID.
Renee:And it doesn't matter how good logistics are. It's not what it's about at that point, right? Like, yeah, we can get it there, but, you know, yeah. Okay. So that's a wrap on our deep dive of history of logistics from steam engines to drones. It's amazing to see how far we've come. And the future, well, it looks like one giant tech-powered logistics dream. Thank you guys for tuning in to another episode of Nostalgic Nerds. We'll be back next week with more geeky goodness. Don't forget to hit that subscribe button and leave us a review if you like this journey through time. Marc, thank you.
Marc:All right. Thank you. See you later, nerds.
Renee:Until next time, you nerds. Keep your deliveries on time and your cargo well organized. We'll see you again.
